Environmental tax hike must be rolled out transparently

Đinh Tuấn Minh, an economic expert from the Institute for Policy Research and Technology, speaks to the newspaper Kinh tế& Đô thị (Economic and Urban Affairs) on the need for transparency and accountability in the decision to raise the environmental tax on diesel and petrol How do you respond to the National Assembly Standing Committee’s decision to increase the environmental tax on diesel and petrol? Generally speaking, our annual State budget collection has increased year on year. However, what people worry about is that the increase in our state budget collection is smaller than the increases in our spending. I still remember that the previous tax increase on diesel and petrol from VNĐ1,000 to VNĐ3,000 (US$0.05-0.15) per litre some years ago did help considerably improve the State budget collection. I’m pretty sure that the increase in the environmental tax on diesel and petrol to VNĐ 4,000 ($0.2) per litre in 2019 will help to increase our State budget collection. It is expected that the amount of tax collection from selling diesel and petro will be over VNĐ55,000 billion per annum – an increase of about VNĐ14,368 billion per annum compared with the old diesel and petrol prices. According to the Government’s point of view, the increase in the prices of diesel and petrol will not affect the price index in the country, nor the general public’s consumption or the country’s growth rate due the decreases in quite a few tax categories which are levied on imported goods. A key reason… [Read full story]